A planned $1.5 billion Islamic fund to finance infrastructure projects will establish its Asian regional office in Brunei, the fund's manager said Monday, December 11.

Emerging Markets Partnership (Bahrain) E.C., the general partner and manager for the Islamic Development Bank Infrastructure Fund, said in a statement it had received approval from Brunei's finance ministry.

Brunei officials said the decision was expected to boost the tiny, oil-rich sultanate's ambitions to find a niche as an Islamic financial centre.

Mindful that its oil resources would run out in 25 years, Brunei in July announced reforms that would diversify its economy and reduce total dependence on petro dollars.

Deputy Finance Minister Haji Munap said Monday that establishing the fund's regional office in Brunei marks "an early success in Brunei Darussalam's strategy to develop an international financial centre" focussing on Islamic finance.

The fund plans to invest in private sector infrastructure projects such as power, telecommunications, natural resources development and transportation.

Of the total fund, $1 billion will be invested as equity capital and $500 million will be an underwriting facility to promote the use of Islamic finance in projects where equity is invested.

Such investments could start in Brunei and neighboring Malaysia, later expanding into Indonesia, the world's most populous Muslim country.

The Philippines' southern island of Mindanao is also home to the largely Roman Catholic nation's Muslim minority, who have complained of being left out in terms of development funds.

Brunei this year also announced plans to set up a global Islamic money market in cooperation with the central banks of Bahrain, Indonesia and Malaysia.

In August, Brunei adopted global accounting standards and pledged to push for legislation to cover international banking, global company operations, trust and limited partnerships as well as registered agents and trustee licensing.— (AFP)